SYRACUSE, N.Y. - Dr. David R. Smith continues to draw a paycheck from New York state despite resigning as president of Upstate Medical University two months ago.

Smith stepped down Nov. 15 amid a state investigation into whether he had padded his compensation without proper authorization from the head of the State University of New York.

His president's salary of $363,000 a year was replaced the next day with a salary of $205,558 as a professor at the medical school, according to SUNY documents obtained by Syracuse.com and The Post-Standard under the state's freedom of information law.

Smith has been getting that pay - nearly $4,000 a week - but hasn't been going to work because he's been out on medical leave, Upstate officials said.

The FBI is investigating Smith's compensation from two companies that do business with the hospital and medical school, sources have said. He has not been charged with any crimes and is not facing disciplinary charges from SUNY.

SUNY officials say they had no choice but to put Smith into the faculty position and pay him. Under a SUNY board of trustees policy, which is part of the state's code of rules and regulations, every campus president must be allowed to continue working as a faculty member as soon as he or she leaves the job.

Dr. Gregory Eastwood, Upstate's interim president, wrote in a letter to Smith Dec. 19 that Smith's job title changed Nov. 16 from president to full-time professor of health sciences in the Pediatrics Department.

Eastwood set Smith's salary at $205,558, according to the letter. But Eastwood had little room for discretion in setting the amount or in changing Smith's job title, SUNY officials said.

The salary was determined by a pay schedule in SUNY's administrative office of human resources and was based on Smith's position as a full professor in health science, SUNY officials said.

Then-SUNY Chancellor John Ryan wrote in a 2006 memorandum to the board of trustees that as president Smith would receive a $300,000 salary plus a $5,000 monthly housing allowance.

In that document, Ryan said that, as a physician, Smith would be eligible to participate in Upstate's faculty practice plan.

Along with his compensation as president, Smith's faculty position was affirmed in a 2006 letter. But he did not start receiving pay for the faculty job until two months ago.

SUNY officials say the case is being handled just like any other involving an employee who's a member of a union and who therefore has rights to due process. As a professor, Smith is a member of the United University Professions.

But the head of another union at Upstate says the case presents a double standard.
Kathy Yeldon, president of CSEA Local 615, said she knows of cases where her members were placed on administrative leave while disciplinary charges are being investigated. Those employees are paid only for a few weeks, never more than six weeks, she said.

"SUNY Upstate disciplines their employees for various things, suspends them without pay until things go to arbitration," Yeldon said. "And they continue to allow somebody to be paid because of his stature? I mean, if this was a CSEA member, I don't think they'd get the same treatment."

The big difference between those disciplinary actions and Smith's case is that he's not facing disciplinary charges, SUNY officials said.

Yeldon's response: If he had been a lower-level employee, Smith likely would be facing disciplinary charges by now.

SUNY is continuing its review of Smith's case, according to spokesman David Doyle.

Syracuse.com and The Post-Standard asked SUNY for other documents related to Smith's time as president. But SUNY denied those on the grounds that disclosing them could interfere with a law enforcement investigation.

SUNY officials would not say which law enforcement agency is investigating.

The FBI and federal prosecutors launched an investigation last month into the case, according to sources. The U.S. Attorney's Office in Syracuse issued grand jury subpoenas for documents and testimony related to the payments, according to one source.

Smith resigned in November after SUNY Chancellor Nancy Zimpher questioned his compensation from two companies that do business with the hospital and medical school.
She told him in a letter that she was launching an investigation into whether he improperly padded his pay with compensation from MedBest Medical Management Inc. and Pediatric Service Group LLP.

Neither Smith or his lawyer, Michael Whiteman of Albany, could be reached today for comment.